New think tank wants government to see gold in health technology

By Olga KhazanJanuary 24, 2012

A new think tank launched in the District Monday with the goal of reducing the cost of health care through research and entrepreneurship. The West Health Policy Center is the latest project of Gary and Mary West, the two billionaire philanthropists behind the West Wireless Health Institute and the WestHealthInvestmentFund, a pair of California-based organizations that develop and fund health technology products.

The new center will conduct research on better reimbursement models, improved price transparency and “smart technology” — a field that includes mobile health monitors and other innovations.

The center’s chairman, Don Casey, said one of the organization’s goals is to spur health insurers’ eventual embrace of mobile health technology as a money-saver. If they were used on a large scale, Casey said mobile health devices could manage chronic diseases by monitoring vital signs remotely and feeding the results electronically to doctors’ offices. Proponents argue it would be a cheaper and more effective alternative to pricey office visits that are triggered by “acute events,” like heart attacks or infections.

“You can’t move people out of the expensive places of care if you don’t set up a system that allows data and biometrics to be gathered conveniently and pushed through algorithms to a health provider so that he or she knows when someone is moving to a danger zone,” Casey said.

The West Wireless Health Institute developed and is currently conducting a research study on one such device, called Sense4Baby, a wireless fetal monitoring system for high-risk pregnancies.

So far a main hurdle for the mobile health trend has been the reluctance of most insurers to reimburse health care providers for using the products, a fact that Casey hopes the policy center will help change. To that end, the organization will employ research fellows to determine policy changes that would conceivably save at least $1 billion annually in health care costs.

“We will be churning out primary research that we look forward to bringing to policymakers,” Casey said. “We want to change the paradigm to a system that combines mobile health into a bundled payment for insurers. That would give us far better outcomes at a dramatically lower cost.”

One of the center’s first orders of business is a conference with the Centers for Medicare and Medicaid on health care innovations this Thursday, which will bring together at least 200 entrepreneurs and venture capitalists to talk about the future of health tech.

And why would so many entrepreneurs want to get into a health market that insurers haven’t quite caught up to yet? Casey said it’s because the tide is turning in favor of health technology — slowly but surely. The Affordable Care Act provided certain Medicare providers with incentives to keep costs down, for example, and in October some hospitals will start to be penalized for preventable hospital re-admissions. And those changes could add up to big business opportunities for health-savvy entrepreneurs.

By way of explanation, Casey paraphrased Wayne Gretzky: “Don’t focus on where the puck is, focus on where the puck is going.”